Tag Archives: timberpeg

I received an email asking about the potential value difference between a new construction timberframe (post and beam, timber-frame, timber peg) home and the cost to construct it.

Question:

I plan to build a small timber frame home on a lot I own in NH but I am worried about the appraisal for the construction loan. In your experience, do new construction timberframe homes appraise significantly lower than cost to build? Thank you.

Hi Gene,

There are so many variables that go into valuing a home. Quality of construction is one of them…timberframe homes are certainly one of my personal favorites, and would typically merit a quality adjustment. I say typically because some towns do not lend themselves to custom built homes so therefore no quality adjustment would be given.

Try to keep the value close to the median of that town, don’t be the most expensive home. Seeing as it’s a small home, and perhaps a more simple frame, you may be fine.

So my answer is that “it depends” but most likely a timberframe home would not appraise lower than typical construction…if anything it may be slightly higher due to the unique construction.

When building a new home there are many things you need to keep into consideration if you need to get a loan. Don’t over build in size, in upgrades, in amenities…just don’t overbuild. If you are building your dream home, plan on living there for a long time, and have the extra cash when the appraisal comes in low then go for it. The timing for new construction has to be right too, with values going down over the last few years you could buy a existing, prebuilt, home for far less than new construction. That’s changing now that the housing market has been stable in most areas in southern and eastern New Hampshire. Housing starts are starting to increase!